NEWS

Trichet made threat to Lenihan, not me - Noonan claims

Finance Minister Michael Noonan at the press briefing on the Budget 2016 on Tuesday evening at Government Buildings. Photo: RollingNews.ie

17:39 29 Jan 2016
Newstalk
17:39 Friday 29 January 2016

The Finance Minister says the Former head of the ECB Jean Claude Trichet never made a threat towards him in 2011 – but he believes former Finance Minister Brian Lenihan was threatened with the withdrawal of support for Irish banks.

Michael Noonan today denied the accusation he faced a threat from Mr Trichet but said he has seen correspondence from 2010 where Mr Trichet appeared to threaten Mr Lenihan with the withdrawal of emergency support for Irish Banks.

Mr Noonan told the Dáil in November 2011 that the ECB never threatened Ireland over its plans to burn bondholders, but the Banking Inquiry Report this week found the government could not impose losses on senior bondholders because of an “explicit” threat from the ECB.

Yesterday in the Dáil Stephen Donnelly TD said it was clear that Mr Noonan had misled the Dáil, and should resign.

“I have no doubt that this is going be brushed off by Fine Gael about semantics or whatever else, because we don’t have political accountability,” Mr Donnelly said.

“Which is a great irony in the context of exactly what the Banking Inquiry was trying to show - a lack of accountability, in the regulator, in the department of finance and in politics,” he added.

However Minister Noonan says that's not the case, and any threat was towards the late Brian Lenihan. It was this threat, and not one to him, Mr Noonan said, that the Banking Inquiry report likely referred to.

“(Trichet) made no specific threat to me,” Mr Noonan said.

“On the other hand I did see correspondence where he seemed to be threatening Brian Lenihan with pulling back emergency liquidity assistance to the banks if the bondholders were burned back in 2010, and I presume it was that that caused the committee of inquiry to say that he threatened, but he didn’t threaten me,” he said.